22.11.2006

Intellectual property going unprotected

Over half of Yorkshire's small businesses are failing to protect their research and development innovations, leaving the valuable fruits of their labours open to hijack by competitors, one of the region's leading solicitors has warned.

Jason Dainty, an intellectual property solicitor at national law firm Irwin Mitchell, based at its offices in Queen Street, Leeds, is concerned too few small and medium sized enterprises (SMEs) in the region are taking measures to protect new products, concepts and ideas, generated by costly and lengthy research and development (R&D).

He said: R&D is a considerable undertaking, particularly for SMEs where resources may be scarce. Not protecting the results of this hard work, using measures such as patents and registered designs, can be a costly error.

Our experience indicates more than half of Yorkshire SMEs could be making this potentially devastating mistake, most of them apparently relying on staff secrecy to avoid coming a cropper.

In particular, without patents or design protection, innovations can be duplicated by competitors, leaving businesses open to attack and finding it difficult to recoup the R&D investment they have made.

We believe almost 60 per cent of middle market companies who are actively innovating aren't using patents.

Patents can protect the concept and technical function of innovative products or processes by excluding others from making, using, selling or importing them, for up to 20 years.

Mr Dainty said Yorkshire businesses often hold off from obtaining patents, due to the outlay, until they have tested the market to establish commercial viability.

He said: Where a small firm needs to find a partner to bring a product to market, very often they want to assess whether it's going to fly. In these circumstances the discussions must be covered by non disclosure agreements or any future applications for a patent will be invalid.

Without the cloak of confidentiality, sharing your ideas constitutes public disclosure, meaning other companies can duplicate these freely.

Turning to registered designs, Mr Dainty said: If it's the shape and appearance of a product that's innovative or novel, rather than the concept or function, SMEs can use registered designs to protect their investment. It is also now possible to obtain Europe wide coverage with a single low cost application.

Other IP rights that don't require registration may also apply, but it's usually necessary to prove copying has taken place, which isn't always easy. However, unregistered rights may assist as a fall back position. Therefore, it's essential companies keep comprehensive records of creation, to demonstrate ownership.

With modern computer aided design systems, this may happen automatically, but a periodic health check is advisable. However, this shouldn't detract from best practice, which is to seek registration where possible. It's advisable for companies to formally register work as early as possible and update this regularly, as their innovation develops.

Any businesses concerned about protecting their innovations can contact the Irwin Mitchell intellectual property team on 0370 1500 100